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NETSUITE: REORG UPPED RETENTION

NetSuite says a reorganization of the sales force that addressed its installed base, coupled with a change in the compensation plan, has significantly improved customer retention this year. The statement came from CFO Ron Gill this week when he addressed a Wells Fargo Securities Technology, Media and Telecom conference.

Existing customers are handled by account manager representatives who take over accounts after implementation, normally about nine months after the sale. "The way it used to work was that the account management reps had extremely large territories," Gill said. Reps could have as many as 100 accounts that came up for renewal each year. That led them to focus on the clients to whom they could most easily sell new services, while ignoring the others. Hiring in this sales area was designed to cut down on the number of accounts each handled to make sure they could talk regularly to each of their accounts, "not just when the invoice was due," Gill said. NetSuite also changed compensation so the reps were paid based on the entire renewal, not just the new services.

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